Jubao Xie’s FiDi Holiday Inn Receives $137M in Refinancing
The Chinese developer received the loan for the tallest Holiday Inn in the world from Ladder Capital.
NEW YORK CITY—Under the limited liability corporation, Golden Seahorse, Jubao Xie received $137 million in senior, non-recourse, permanent financing for the Holiday Inn, Manhattan – Financial District. Built in 2014, the 50-story, 492-key hotel is the largest Holiday Inn in the world. Located at 99 Washington St. between Rector and Carlisle streets, the hotel is near the World Trade Center.
Ladder Capital provided a fixed-rate loan, which will be used to refinance an existing first mortgage and return capital to the borrower, according to Mission Capital who negotiated the loan.
Xie developed the property with Sam Chang, the chairman of McSam Hotel Group, a major New York City hotel developer. In November 2014, Chang and Xie received $135 million in refinancing from UBS. The loan replaced the existing construction debt of $45 million from Cathay Bank, according to Commercial Observer. In December 2014, Xie bought out Chang’s interest, according to Real Capital Analytics.
The Real Deal reported that in December 2017, Xie had placed the hotel on the market with Marcus and Millichap seeking an asking price north of $300 million. With the mortgage loan maturing, Xie considered selling but evaluating local dynamics and capital markets decided to refinance, according to the publication.
A Mission Capital Advisors debt and equity finance team with Beau Williams, Ari Hirt, Steven Buchwald, Alex Draganiuk and Jamie Matheny represented the owner in this most recent loan.
The brokers note that the hotel has achieved significant market penetration and currently has a 93% occupancy rate. The property also includes the restaurant and bar, St. George Tavern.
“The borrower was looking to lock in a low interest rate loan without amortization, and we were able to create a very competitive market, with various banks, insurance companies and CMBS lenders vying to structure favorable deals,” says Williams. “By identifying a network of lenders who recognized the strength of the sponsor and its management team, we were able to achieve our client’s goal of securing low-interest, non-recourse financing that is interest-only for the full 10-year term.”
“Hotel properties continue to perform well across the country, and with New York City receiving a record number of tourists, hospitality properties in the New York are very attractive to capital providers,” says Hirt. “Thus far in 2018, Mission has arranged financing for nearly 20 hotel properties, with 20% of the financings exceeding $100 million in loan proceeds.”
The Holiday Inn financing is one of the largest permanent loans this year on a New York City hotel, and it indicates the appetite lenders have for well-located hotel properties, Hirt adds.